USDCAD potential for further growth remains

USDCAD potential for further growth remains. The decline of USD/CAD from 1.2827 stopped at 1.2631 after the decision of the Bank of Canada to leave the interest rate unchanged at 0.25%.

The maintenance of the current course of monetary policy by the financial regulator is associated with the revision of inflation targets. Deputy Governor of the Bank of Canada Toni Gravelle said the day before that fears about the risks of a jump in consumer prices are only growing at the moment.

In turn, the decrease in the number of initial jobless claims in the United States to 184K strengthens the US dollar (analysts predicted the figure at 215K). Today the markets will be influenced by US inflation data, which will be published at 15:30 (GMT+2). Core inflation is expected to be 4.9% on an annualized basis and 0.5% on a monthly basis. Further growth in consumer prices prompts the US Fed to tighten monetary policy. The first step aimed at changing the current situation in the national economy will be the curtailment of the bond repurchase program, which is planned to be phased out by mid-2022.

Support and resistance

The long-term trend in USD/CAD is upward. This week the support level of 1.2631 was tested, which was held by the traders. Then USD/CAD quotes reached 1.2700 and now the main target of growth is at 1.2827, the breakout of which will allow the “bulls” to consolidate in the area of 1.2910.

The medium-term trend is upward. Target zone 2 (1.2775–1.2752) was broken out last week. The next upside target is target zone 3 (1.3021–1.2997). This week the price has corrected to the key trend support area at 1.2614–1.2592, which was held, and as a result, the price continued to rise.

Resistance levels: 1.2827, 1.2910, 1.3138.

Support levels: 1.2631, 1.2434, 1.2295.

USDCAD potential for further growth remains

Similar Posts